Premier Foods (LSE:PFD) upgraded its full-year profit guidance on Thursday, as lower financing costs following a bond redemption pushed adjusted earnings ahead of plan and prompted the board to introduce an interim dividend for the first time in 19 years.
The London-listed food producer, owner of brands including Mr Kipling, Bisto and Oxo, reported headline branded revenue up 3.2% to £467.3m for the 26 weeks ended 26 September, with trading profit rising 2.4% to £72.2m.
Adjusted profit before tax climbed 3.8% to £64.7m, helped by lower interest costs, while adjusted earnings per share rose 4.0% to 5.6p.
Statutory profit after tax fell to £41m from £46.8m a year earlier, which the company attributed to higher restructuring costs and a lower pension credit; statutory revenue rose 2.5% to £514.5m.
Sweet Treats branded revenue grew 6.7%, extending a run of 12 consecutive quarters of branded growth, and Mr Kipling became a £200m brand for the first time, with revenue up 10%.
Grocery branded revenue rose 2.0% on a headline basis, with the division's performance tempered by prolonged hot weather that dented demand for gravy, stock and soup.
International revenue increased 8% in the first half and 10% in the second quarter, with FUEL10K making what the company called an "encouraging start" in Europe following its launch there.
The three brands Premier Foods has acquired in recent years, The Spice Tailor, FUEL10K and Merchant Gourmet, each delivered double-digit revenue growth in the period and remain on track to generate approximately £100m of combined revenue this financial year, according to the company's recent trading updates.
Net debt fell to £131.2m from £207.1m a year earlier.
"Following the redemption of our fixed rate bond, we now have an updated capital structure which provides us with both the flexibility to deliver on our growth strategy and lower financing costs than previously planned," said chief executive Alex Whitehouse.
"We are therefore today upgrading both our adjusted PBT and adjusted EPS expectations," he said, adding that the group has "significant firepower available to expand the size of the business through the acquisition of further, future-focused, high growth brands."
Read more about Premier Foods
- 16/07/26Premier Foods reports branded revenue growth in Q1
- 15/05/26Premier Foods lifts trading profit above £200m as branded revenue strengthens
The board will pay an interim dividend of 1.12p per share on 18 December to shareholders on the register as of 20 November, additive to the final dividend already paid for FY25/26; the quantum of this new interim payment follows the 20% increase to 3.36p the board applied to the FY25/26 final dividend at the May results.
Capital investment rose 54% to £35.9m in the half, as the company continues to fund efficiency and automation projects at its manufacturing sites.
For the full year, Premier Foods now expects net regular interest of approximately £18m, trading profit growth of around 3-5% ahead of FY25/26, and adjusted profit before tax and adjusted earnings per share at the top end of current market expectations.